Lawmakers in Michigan proposed to make another moratorium for 90 days for those that face foreclosure. They feel this will allow the homeowner more time to work something out with the lender before the three months pass. There are certain criteria that the homeowner must meet before they will be eligible for the freeze.

The homeowner must have already received a foreclosure notice in order to be eligible for the proposed plan. The notice is required to include a list of counselors developed by the Michigan State Housing Development and Authority that the borrower can contact since they must meet with one along with the lender being present. The new law would require before the lender can finalize the foreclosure that they must show proof that they showed effort in trying to modify the loan or make a repayment plan otherwise the foreclosure cannot continue or the lender will need to come to court and explain why they didn’t work out something with the borrower.

The legislation would take effect 45 days after it has become law which means those that are in foreclosure at this time will not be able to benefit from this new law. The anticipation of many more foreclosures to come is part of why new foreclosure laws are being developed.